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Today, mobile technology allows many exempt employees to work remotely and perform work outside traditional working hours. Some commentators assert that the smartphone has stretched the traditional 9-to-5 workday into a 24/7 on-call period, where employees are expected to respond to work-related communications long after they leave the office and late into the night. The expectation that employees will be available to respond on evenings and weekends, however, has sparked pushback, causing some employees to call for more work-life separation and the ability to “unplug.” In France, this push to unplug recently resulted in a new law that gives employees a “right to disconnect.” Under that law, many French employers soon will be required to implement rules governing work-life balance and reasonable use of digital tools.

Although unintentional, the Department of Labor’s (“DOL”) new overtime regulations might just give certain employees the ability to “unplug”—but at a cost. As we reported here and here, under the new regulations, the DOL nearly doubled the minimum salary threshold for the “white collar” exemptions to $47,476. In the face of this substantial increase in the salary threshold, many employers have opted to transition certain formerly exempt employees into non-exempt roles.

As employers know all too well, reclassification comes with a multitude of onerous state and federal wage-and-hour compliance hurdles. Tracking time that non-exempt employees spend responding to e-mails and otherwise performing other compensable work outside the traditional workday poses significant challenges for employers and can increase the risk of off-the-clock and reporting time pay claims. As a result, many employers prohibit or restrict non-exempt employees from using company devices (e.g., smartphones, tables, laptops) or otherwise working outside their normal punch times.

While many newly non-exempt employees might enjoy being untethered from their smartphone, they may be more resistant to other aspects of non-exempt work. Formerly exempt employees often are accustomed to greater flexibility, relative autonomy, and other benefits associated with exempt status. In many cases, reclassification is as much a culture change as it is a matter of compliance. Exempt workers generally have more control over when and where they work. For example, many exempt workers have flexibility to leave the office early to attend a child’s soccer game, and resume working later in the evening.

Transitioning to a non-exempt role often means decreased flexibility because employees will be required to track and report their time, and employers will aim to reduce risk by limiting after-hours work. Employee frustration is even more likely to occur where telecommuting or other benefits such as generous time off policies are tied to exempt status. Conversely, employers may need to be mindful that employees who remain in exempt roles do not bristle at being asked to take on additional assignments or work outside of traditional working hours if their non-exempt colleagues are immune from such requests.

In considering how to structure a workforce, including how to ease transitions from exempt to non-exempt roles and manage employee interactions, employers may want to reevaluate how they relate to their employees and what types of flexibility—or after-hours coverage—might be strategic and appropriate for newly-nonexempt employees. To explore creative solutions for maintaining company culture and employee satisfaction while also ensuring legal compliance during a reclassification, employers are encouraged to contact their employment counsel.

Compare jurisdictions: Employment & Labor: International

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